Altcoins Correct as Analysts Warn of Early Altseason Potential

Negative sentiment has resurfaced in the altcoin market after several major tokens experienced sharp corrections. However, analysts warn investors not to make hasty decisions. Based on monthly chart data, the current condition may actually signal the early phase of an altseason, not the end of the cycle—a moment that calls for calmness and strategic planning.

Altcoin Market Cap Briefly Hit $1.56 Trillion Before Correcting

The total altcoin market capitalization briefly reached $1.56 trillion—just about 5% below the previous cycle’s peak—before correcting earlier this week. This correction triggered sell-offs near key resistance levels, reigniting investor concerns. According to a report by Coin Edition, the monthly MACD technical indicator has formed a bullish crossover—a key early signal of a long-term upward trend. The MACD histogram now shows positive bars, indicating that market momentum is shifting toward a new bullish phase. Analysts emphasize that this pattern rarely occurs except at the beginning of significant uptrends.

Strengthening RSI: Evidence of Accumulation Phase

Alongside MACD, the monthly RSI indicator displays a higher-low pattern, suggesting gradual accumulation rather than widespread distribution. Several analysts predict that the period from late July to early August could serve as an inflection point, opening the door for a stronger price rally in the near term.Bitcoin (BTC) dominance has started to weaken, while the ETH/BTC ratio is showing signs of strength, indicating a capital rotation from BTC to altcoins. From a technical perspective, the weekly altcoin structure resembles a cup-and-handle formation, which is generally considered a bullish signal.

Avoid FUD, Focus on Long-Term Trends

Analysts stress that the current mild correction is normal during the early phase of an altseason and does not indicate the cycle’s peak. On the contrary, this situation may present a strategic opportunity for accumulation, with a focus on higher timeframes and key technical signals.